Yes, but only through specific government-backed programs, and they come with real limits

You can buy a home without putting money down, but not through a conventional mortgage. Instead, you would use a VA loan (if you are a military veteran or active-duty service member), a USDA loan (if you are buying in a rural area and meet income limits), or an FHA loan with a 3.5% down payment (which is the smallest conventional option, not zero). These are the only paths that exist. Private lenders do not offer zero-down mortgages to regular buyers.

The catch is that zero-down loans cost more in other ways. You pay higher interest rates, you must pay mortgage insurance (a monthly fee that protects the lender if you stop paying), and you may have access to for a smaller loan amount. A lender sees zero down as higher risk, so they charge you for that risk every month for years.

Key Takeaways

  • VA loans and USDA loans are the only true zero-down options; FHA loans require 3.5% down, which is the minimum for any conventional path.
  • All zero-down mortgages require mortgage insurance, which adds $100 to $300+ per month to your payment depending on the loan size and your credit score.
  • You must meet specific requirements: VA loans require military service, USDA loans require a rural property and income under the area limit, and FHA loans require a credit score of at least 580.
  • Zero-down loans approve you for less money than a down-payment loan would, because lenders see the risk as higher.
  • The real cost of zero down is paid over 15 or 30 years in higher monthly payments, not upfront.

VA loans: zero down if you served

A VA loan is a mortgage backed by the U.S. Department of Veterans Affairs. If you are a veteran, active-duty service member, or surviving spouse of someone who died in service or from a service-related injury, you may be able to borrow the full purchase price with no down payment and no mortgage insurance.

To use a VA loan, you need a Certificate of may be able to access, which you request from the VA. The process takes a few days to a few weeks. You then take that certificate to a lender (a bank, credit union, or mortgage company) and explore for the mortgage. The lender will order a home appraisal and verify your income and credit, just as they would for any mortgage.

VA loans have no mortgage insurance, which saves you hundreds of dollars per month compared to other zero-down options. However, you do pay a VA funding fee — a one-time charge that the VA collects to offset the cost of the program. This fee is usually 1% to 3.6% of the loan amount and is rolled into your mortgage, so you pay it over time rather than upfront. Some borrowers (like those with service-connected disabilities) are exempt from this fee.

USDA loans: zero down in rural areas

A USDA loan is a mortgage for people buying homes in rural areas, backed by the U.S. Department of Agriculture. You can borrow 100% of the purchase price with no down payment. Like VA loans, USDA loans have no mortgage insurance.

To may have access to, your property must be in a USDA-may be able to access rural area (you can check this on the USDA website by address), and your household income must be below the limit for your county. Income limits vary widely by location — a rural area near a city may have a higher limit than a remote rural area. You also need a credit score of at least 580, though 620 or higher makes approval easier.

USDA loans do charge a may provide fee, similar to the VA funding fee. This is usually 1% to 2% of the loan amount and is added to your mortgage balance. You pay it over the life of the loan, not upfront.

FHA loans: the smallest down payment option

An FHA loan is a mortgage insured by the Federal Housing Administration. It is not zero down — it requires a minimum of 3.5% down — but it is the smallest down payment available through a mainstream lender. If you have saved $7,000 for a $200,000 home, an FHA loan is how you would buy it.

FHA loans are easier to may have access to for than conventional mortgages. You can have a credit score as low as 580 (though 620 is more common), and your debt-to-income ratio can be higher. This makes FHA loans the path for people with limited credit history or recent financial problems.

The trade-off is mortgage insurance. FHA loans require both an upfront mortgage insurance premium (1.75% of the loan amount, usually rolled into the mortgage) and a monthly mortgage insurance payment (0.5% to 1% of the loan amount per year, divided into 12 monthly payments). This insurance stays on your loan for the life of the mortgage if you put down less than 10%, or for at least 11 years if you put down 10% or more.

What mortgage insurance actually costs you

Mortgage insurance is the hidden cost of zero-down and low-down borrowing. On a $200,000 FHA loan with 3.5% down, your monthly mortgage insurance payment could be $150 to $250 per month, depending on your credit score and the exact loan terms. Over 30 years, that is $54,000 to $90,000 in insurance alone, on top of interest.

VA and USDA loans avoid this by rolling a one-time fee into the mortgage instead. A VA funding fee of 2.3% on a $200,000 loan is $4,600, added to what you owe. You pay interest on that $4,600 over 30 years, but you do not pay an additional monthly insurance premium. This is why VA and USDA loans are significantly cheaper than FHA loans if you may have access to for them.

How much you can borrow with zero down

Lenders approve you for less money when you have no down payment. A conventional mortgage might approve you for $300,000 if you put 20% down, but only $250,000 if you put nothing down. The reason is straightforward: the lender sees you as higher risk because you have no skin in the game. If the home value drops or you hit financial trouble, you are more likely to walk away.

The exact amount depends on your income, credit score, and existing debt. A lender will calculate your debt-to-income ratio — the percentage of your monthly income that goes to debt payments — and use that to set your maximum loan. With zero down, most lenders cap this ratio at 43% to 50%, meaning if you earn $5,000 per month, your total monthly debt payments (including the new mortgage) cannot exceed $2,150 to $2,500.

When zero down makes sense, and when it does not

Zero down is worth considering if you are a veteran with a VA loan, or if you are buying a rural property and may have access to for a USDA loan. Both of these avoid mortgage insurance, which is the real cost of borrowing without down payment money.

Zero down through an FHA loan is harder to justify. You are paying $150 to $300+ per month in mortgage insurance for 11 to 30 years. If you can save even 5% to 10% down, your monthly payment drops significantly, and you build equity faster. The math often favors waiting six months to a year to save more, rather than buying now with FHA insurance.

The exception is if home prices are rising faster than you can save, or if you are in a competitive market where waiting means losing homes to other buyers. In that case, FHA with mortgage insurance may be the only way forward.

Frequently Asked Questions

Can I get a zero-down mortgage if I am not a veteran and do not live in a rural area?

No. VA and USDA loans are the only true zero-down options, and they have specific requirements. FHA loans require 3.5% down. Conventional mortgages require at least 3% to 5% down. No mainstream lender offers zero down outside these programs.

What if I have bad credit — can I still get a zero-down loan?

It depends on the program. VA loans do not have a minimum credit score requirement, though most lenders will want 620 or higher. USDA loans require 580 minimum, 620 preferred. FHA loans allow 580 minimum. If your score is below 580, you will need to improve it before any of these options are available.

Does the mortgage insurance ever go away?

On FHA loans, mortgage insurance stays for the life of the loan if you put down less than 10%. If you put down 10% or more, it stays for at least 11 years. On VA and USDA loans, there is no monthly mortgage insurance — only the one-time funding or may provide fee rolled into the loan.

What happens if I pay off the mortgage early — do I get the mortgage insurance back?

No. Mortgage insurance is not refundable. If you pay off an FHA loan after five years, you have paid five years of insurance and will not get that money back. This is another reason why putting down more money upfront, if you can, often saves money in the long run.

Can I use a zero-down loan to buy a second home or investment property?

VA loans can be used for a primary residence only. USDA loans can be used for a primary residence only. FHA loans can technically be used for investment properties, but lenders are stricter about approval and may require a larger down payment. For investment properties, conventional mortgages with 15% to 25% down are more common.